In a report released Wednesday, the UCLA Anderson Forecast does not see U.S. economy slipping into recession, but anticipates California’s economy will continue to weaken as the state’s fiscal crisis and the housing and finance sectors continue to be a drag on growth.

Despite a spate of bad economic news, economists at the forecast believe the nation and state’s economy should just be able to stay above water.

“The major risk facing the economy is whether or not the consumer will buckle under the weight of falling house prices, high energy prices and tepid wage growth,” said Senior Economist David Shulman, in a report that will be discussed at the Forecast’s quarterly conference.

Economist Jerry Nickelsburg said the California economy will be weaker than the U.S. economy, especially as measured by employment and personal income. Unemployment will stay in the mid-7 percent range this year with only modest improvement next year.

The Forecast projects a decline in personal income (after adjusting for inflation) in the third quarter, and another -0.9 percent decline in the fourth quarter before beginning to recover in the first quarter of 2009.

“Our near term quarterly forecast has things getting worse before better,” Nickelsburg said in his portion of the report.

Nationally, the Forecast expects real GDP growth to be about 1 percent in the current quarter and essentially zero in both the fourth quarter and the first quarter of 2009.

“What we are describing is an economy operating at its ‘stall speed’ where any modest shock can trigger a full-blown recession,” Shulman said.